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Mathematical Problems in Engineering
Volume 2014, Article ID 218132, 8 pages
http://dx.doi.org/10.1155/2014/218132
Research Article

Application of Fuzzy Optimization to Production-Distribution Planning in Supply Chain Management

1Manufacturing System Integration (MSI), Department of Mechanical Engineering, Faculty of Engineering, University of Malaya, 50603 Kuala Lumpur, Malaysia
2Department of Industrial Engineering, Faculty of Engineering, Shahid Bahonar University of Kerman, Kerman 7618891167, Iran

Received 31 January 2014; Accepted 7 April 2014; Published 28 May 2014

Academic Editor: Michael Lütjen

Copyright © 2014 S. Ariafar et al. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

Abstract

A production-distribution model has been developed that not only allocates the limited available resources and equipment to produce the products over the time periods, but also determines the economical distributors for dispatching the products to the distribution centers or retailers. The model minimizes production, inventory holding, backordering, and transportation cost while considering the time value of money. Since uncertainty is an inevitable issue of any real-world production system, then to provide a realistic model, the concept of fuzzy sets has been applied in the proposed mathematical modeling. To illustrate and show the feasibility and validity of the model, a real case analysis, which is pertaining to a mineral water bottling production factory, has been used. The case has been solved using a three-step solution approach developed in this study. The results show the feasibility and validity of the mathematical model, and also the solution procedure.